A Perfect House And A Long Commute

This is a dilemma most home buyers have to face. On one hand, they have their dream property right in front of their eyes and on the other; they have the ignominy of a long commute. But before discussing the long and short of this, what defines a long commute. Is it a 30 minutes drive, a 45 minutes exercise, an hour and a half gruel? The time needs to be factored in. Also, if one is commuting for that long, you need to calculate the returns you are getting while doing so. The ideal question should have been, is it worthwhile?

Now, money is and will forever be a finite instrument. Just like life and time.  So how much of it would you be spending in the car, stuck in traffic and not being happy about it at all? Perhaps nothing at all. However, let’s look at the other possibilities. Your workplace, even though at a great distance from your new home, pays you well. It pays you to afford a great house, bills that you need to pay each month, education for your child et al. If that is the kind of job you are currently in, the journey is worth the while. Also, the title did mention a perfect house. Now that would mean, it did fit your budget more admirably than the other ones which you had checked out. The advice would be stick to it. Both your job and your perfect house matter and what links both of them is the paycheck you receive every month. Of course, if either one is suspect, then you have to start looking for newer possibilities. If it is not and I presume it surely is not, a commute should not be the deciding factor. Certain other things to look out for. Is the new house, which seems perfect to you, in a good school district, provided you are a couple. Even if you are not, the future needs to be factored in.

Statistics show that while the average commuting time has remained unchanged at 25.5 minutes those traveling for more than an hour rose to 11.1 million in 2012. Now that is a rise of 300000 from 2011.

Hence, idea is to strike a balance and it greatly boils down to priorities and find the perfect mix.

Five Easy Tips for Young Homebuyers Buying Their First Home

Buying a home for the first time can be both an overwhelming as well challenging task. You have so many things to consider while buying a property that you will call home for the rest of your life. Young couples often face the daunting task of deciding on a house that fits their pocket as well as aspirations. Thus, it is imperative to do a little financial homework before you can actually get down to some legwork.

Here are 5 easy tips for young homebuyers that will make their task much easier:

  • Check your credit score – To qualify for a loan, your credit score is going to play the most vital role. Every bank follows very strict loan approval criteria when it comes to credit scores. You will have to check your credit report for unpaid accounts or collection accounts or mistakes and rectify anything that can adversely affect your credit score. If you have a damaged credit score then you will have to invest some money and time to get it rectified. You need to keep in mind that only a good credit score will make you eligible for a loan.
  • Weighing your assets and liabilities – First time homebuyers need to weigh their assets and liabilities. They must be aware of the amount of money they draw in and the money that they actually owe. This will give them a clear picture regarding the money that they will need after buying a house.
  • Arrange the documents – You will need documents at every stage of home buying, so be ready with documents like two recent pay slips, tax returns, last two month’s bank statement etc. Buying a home is a time consuming process but when you are ready with the documents, consider one third of the job done.
  • Find out whether you qualify – You will need to find out whether you actually quality for a housing loan or not. For these you can ask the bank officials and find out the amount of money you will need to repay the loans and the exact amount of loan you qualify for.
  • Determine the down payment – You will have to get in touch of your bank and find out the exact down payment that you shall have to make. This again can be determined from the loan amount and the time period for which you wish to take the loan.

Retirement 101: Will I Ever Be Able to Retire?

Most of the people today are busy spending more time contemplating about the future hobbies, adventures, and travels that they would do during retirement. This is also the reason why they are saving and investing as early as today to support the lifestyle that they are envisioning when they already decided to stop working.

However, there is one question that remains in their minds, “Will I ever be able to retire?”. Even though they already have a vision of what is waiting for them in the future, there is still this hint of uncertainty. This is normal. Of course, we can never be so sure of the future, right? Read on and find the answer to your question about retirement.

While 2/3 of people are now investing and saving for their retirement, 15% of them are planning on winning the lottery and 1% of them expect that they would be money-gifted. There are really many factors that intervene when it comes to retirement. But there are ways for you to be sure if you will really be able to retire. Here are some:

  • Know Your Expenses – Knowing your expenses is very critical for your retirement. If you have not been tracking your expenses, now is the best time for you to start your expense analysis. If you understand where your money goes, you can assess how much you will be needing for you to live in comfort during retirement. Do this by:
  • Plan for changes in your retirement expenses
  • Consider downsizing
  • Consider changes in healthcare cost
  • Understand Your Income Sources – Understand what is your income source when you are already retired. Are you depending on annuities, pensions, Social Security, distributions, or your own retirement savings? If you have savings, know if you can convert them into income stream or investment account.
  • Generate extra income
  • Take some risk
  • Do not forget inflation
  • Save More Often – Your savings play a big role in your retirement. It is actually the top consideration during retirement because it is the amount that you can surely use when you stop working. You can use your savings to invest in anything that you would like to do when you reach the age of 60 and up. If you are saving now, save more often. It would really be great help on your retirement.

The answer to the question “Will I ever be able to retire?” will always depend on how you work on it before the time comes. Retirement is not something that people should ignore. It is hard to work and earn money. You would no want your effort to come to waste in the end.

As early as now, do something to remove the uncertainty in you. The above mentioned are tips on how you can guarantee your retirement soon. Doing these tips will significantly determine your future lifestyle and status when you reach the age of your retirement.

Should a Thrift Savings Plan be a Part of Your Portfolio

TSP or Thrift Savings Plan comes under the 401k plan of the U.S. federal government. In terms of participant account and investment balance, TSP is the largest among all 401k-like plans. In this article, we are going to find out whether TSP is actually suitable for your portfolio or not. However, in order to determine this, we will need to dig deeper and find out the pros and cons of this savings plan while also finding out some strategies to include TSP in your portfolio.

TSP or Thrift Savings Plan

Under the retirement plans of US federal employees, TSP forms an important one besides Social Security and The Federal Employees Retirement System (pension). Both the military as well as the civilian employees of the federal government are eligible for this contribution plan.  Both traditional as well as the Roth accounts are offered by TSP.

Benefits of Thrift Savings Plan

  • Expense ratios are low
  • The five L funds along with the other six core funds have an expense ratio of 0.029%, which is $2.90 on an investment of $10,000. Thus, TSP maintains the lowest expense ratios for the mutual funds.
  • No hidden costs or fees – There are no hidden costs or fees for investing in TSP
  • Wise selection of funds – Core funds of TSP include C fund, S fund, I fund, F fund and G fund which cover majority of the asset classes.
  • Lifecycle funds – The five core funds are maintained in different percentages that matches the Lifecycle of Thrift Savings Plan.
  • Covers your entire life – Even when you separate from the federal service, you can still keep the account active while including any retirement plans into TSP.
  • Civilian receive an agency match – The civilians coming under the purview of FERS retirement system are entitled to receiving an agency match.

 

Downsides of Thrift Savings Plan

  • Withdrawal Limits – You will be entitled to only a single partial withdrawal prior to giving you the opportunity to withdraw the entire fund. Thus, there are many people who move to the IRAs post retirement.
  • No conversions within the plan – You are not allowed to convert any part of your traditional balances into Roth Balance.
  • I fund is not that great – I fund is considered to be among the weakest of all the five core funds.

 

Conclusion

Thrift Savings Plan is great for the federal employees but is not considered great for others. Thus, if your financial planning includes TSP then you must weigh your options before putting in your money.

What are the Pros and Cons of Home Ownership.

Home is where the heart is. So went the adage. It has always been drilled into our brain that growing up and buying a home was the smartest financial move ever. In fact, buying a home was and is considered as a very good investment opportunity. Sounds too good to be true, right?  Or is it?

Let us look at the pros and cons of home ownership.

  1. Yale economist and Nobel Prize winner Robert Shiller debates about the feasibility of accepting home buying as an investment. He says, that the returns are just too small and that the premise of real estate appreciation does not always stand true. Calculated over the past 100 years, home prices have grown at a measly rate of 0.3%, after adjusted for inflation. Stocks and bonds have given, over the same period, an annual return of 6.5%. This difference is just big to ignore.
  2. Home buying should be kept as just that. An asset to protect you and your family against the vagaries of nature. As an investment vehicle, it simply does not stand up to the other instruments available in the market. What blunder most do is to make up more than 75% of their investment based on the price of their home. There is an inherent risk because of the lack of diversification.
  3. Owning a home is an absolute matter of pride. And beyond that, a recognition of all the hard work you have put in to buy that property. It is also a sign of prosperity.
  4. Owning a home is an excellent tax saver.
  5. The question of equity comes into play. Rent paid is gone forever. It never builds up your financial equity. However, with a mortgage payment, equity is built over a period in time.
  6. Owning home lets you beat inflation, even though by a very small percentage. According to Prof. Karl Case, long-term housing did have its moment when it went a wee bit ahead of inflation. Now, if you are young and thinking 30 to 40 years ahead, it is a very valuable insurance against inflation. Not a mean task at all.
  7. Contradicting to what I had said in point 1, the house is a risk capital. Again, as mentioned earlier, a home should never be viewed as a way to get rich, because it simply does not work that way. However, equity in a home can always be linked to your portfolio.

Home owning does have its fair share of pros and cons.  It totally depends on the individual and his or hers financial situations. But as the line goes, “Home sweet home”.

Saving Now Saves You Tomorrow

At 22 you are the king of the world. Nothing seems to bother you. You are invincible, raring to go and virtually unstoppable. Now pause and take a few steps back. This age, rage, and energy will not last forever. A few years down the line, when you slow down a bit, wisdom will suggest that the future holds no surprises, except old age and financial insecurity.

At 22, your effort to financial security begins.

At first, this might seem to be a scary proposition with too much information floating around, but there is enough reason

  1. Don’t get flustered with all that has been told to you in the form advice. Take an informed decision based on research. All those numbers around mean nothing if looked into properly.
  2. Start saving a little and more often. Start putting that in 401(k) and see it slowly rise.
  3. If you think the social security net will be good enough for you, think again. It is estimated that by 2037, social security benefit requirements will outstrip contributions. As a result of which, it would get difficult for you to sustain after retirement.
  4. The 401(k) is a reliable ally at this age. Start using it wisely. The money that is invested here is absolutely tax-free. The tax will only be deducted when you take it out. So this instrument is quite handy for a 22-year-old and needs to be made use to its fullest.
  5. The IRAs too have loads of benefits to make use of. It is an Individual Retirement Arrangement and is virtually tax-free, both on federal taxes, state and local ones. Of course, there are riders involved, but at this age, that should be bothersome.
  6. Now is the time to be aggressive. At 22, worrying about your retirement, investment becomes an art. Remember, you still have another 20 years or 30 years to go before you hang your boots up. You can take a risk now. Look out for stocks and bonds. With age, you can slowly change tracks and become conservative. Now is not the time.
  7. There are nontraditional ways to invest too. Heard about ETF (Exchange Traded Funds). They can be bought and sold at any time and is just a regular stock in disguise.
  8. Last but not the least. Stop worrying, start saving. That is the only way forward.

Best Free Technical Analysis Charting Software for Investing

The old saying goes “technical analysis is a great way to part traders from their money.” However to some it is still a helpful trend to see market trends and to hopefully buy and invest while it’s still on it’s way up and not when a stock is about to drop in price. Technical analysis has also been called a great tool to see historically where you should have bought and sold. As a predictor though it is often faulty at best and of course if it worked will then everyone would be rich by now.

With that said technical analysis increases your probability of seeing where the market is headed. It provides you some background into how an asset is doing and what might come next and is far better than going into an investment blind.

When you using technical analysis software “uptrends” are marked by seeing at least three successive rising troughs and peaks. While “downtrends” occur when you have at least three successive troughs and peaks.

The four best free technical analysis charting software for investing are below.

EclipseTrader: (http://www.eclipsetrader.org)

eclipse trader
EclipseTrader is an ​Eclipse Rich Client Platform (RCP) application focused on the building of an online stock trading system. featuring shares pricing watch, intraday and history charts with technical analysis indicators, level II/market depth view, news watching, and integrated trading.

Main features of EclipseTrader include:

  • Realtime Quotes
  • Trading Accounts Management
  • Integrated Trading/li>
  • Intraday Charts
  • History Charts
  • Technical Analisys Indicators
  • Price Patterns Detection
  • Financial News
  • Level II (Book) Market Data

 

Qtstalker: (http://qtstalker.sourceforge.net/)

Qtstalker

Qtstalker is a user friendly Technical Analysis package for GNU/Linux (and hence other Unix-like systems). Similar to commercial wares such as Metastock, Supercharts and Tradestation. Keeps to a lean, simple design for speed, portability, and low resource usage. Because it uses a plugin model, Qtstalker can easily be extended.

Main features of Qtstalker include:

  • A point-and-click object-oriented graphical user interface.
  • Chart types include line, bar and candlestick.
  • Customizable colors. Logarithmic and linear arithmetic scaling. Scale to screen.
  • Indicators plugins include MACD, MAs, Bollinger Bands, RSI, and dozens more. Provides access to the TA-Lib library of common functions.
  • A simple scripting facility to create custom indicators. This powerfully enables combination of different plots in one indicator and combining of other indicators and calculations.
  • A special indicator “ExScript” enables external scripts to pass indicator data in.
  • An “Indicator Summary” tool shows a table of all indicator parameters from all active indicators. It also writes the data to XML output for use by external programs.
  • Chart drawing objects: trendlines, buy/sell arrows, horizontal and vertical lines, Fibonacci retracement lines, text and cycles.
  • Quote plugins download data from online sources such as Yahoo, CME, NYBOT.
  • Data import plugins for plain-text CSV files.
  • The “Plugin” architecture for quotes and indicators enables easy future extensibility.
  • Minute, daily, weekly and monthly chart compression options.
  • Various data classes to support for investment types such as stocks, futures, indices, ratios and spreads.
  • A back testing function allowing indicator performance tests using actual trading data.
  • A very basic portfolio manager. Good for tracking open positions. (Suggestions welcome.)
  • A Scanner that can scan the qtstalker database for charts that meet a user defined criteria.
  • A paper trading mode enabling users to practice trading without risking capital.

Free Chart Geany: (http://freechartgeany.sourceforge.net/)

Chart Geany Logo

Free Chart Geany is the free and open source edition of Chart Geany, a commercial solution for market technical analysis and charting.

Main features of Free Chart Geany include:

  • Support for major technical analysis indicators like: Simple Moving Average, Exponential Moving Average, MACD, Relative Strength Index,  Bollinger Bands and Parabolic SAR.
  • Support for various Comma Separated Values  (CSV) formats like Metastock 7, Metastock 8, AMI Broker, Yahoo Finance, Google Finance and Standard CSV.
  • Support for various drawing and text objects like Labels, Trailing Text, Horizontal Lines, Vertical Lines, Trend Lines and Fibonacci Retracements.
  • Line, Bar, Candle and Trend Candle (Heikin-Ashi) charts.
  • Linear or semi-logarithmic price scaling.
  • Zoom In and Zoom out.
  • Time-frames: Day, Week, Month and Year.
  • One click screen shots for charts.
  • Spreadsheet-like data manager.
  • Single file local storage.  You can work offline if needed.
  • Self-contained software, independent from other software back-ends like Java Virtual Machine or .NET Framework.
  • Easy download of quotes from Yahoo Finance or Google Finance.
  • Free Chart Geany is a tab based application. You can manage the charts the same way you manage the pages of your web browser.

AIOTrade: (http://aiotrade.com/)

AIOTrade

AIOTrade (former Humai Trader) is a free, open source (under the terms of BSD license) stock technical analysis platform with a pluggable architecture that is ideal for extensions such as indicators and charts. It’s built on pure java.

Main features of AIOTrade include:

  • Pull stock price from Yahoo
  • Runs on your PC
  • Is built on Java

Let us know if you have any other suggestions for free technical analysis charting software for investing in the comments section below.

How Do You Make Money on Stocks

Hypothetically say you are new to stocks and you ask yourself “how do you make money on stocks?” You might also go how do you make money on them? Is it from cashing out of them? How much money can you make? There is a lot of different question you may have.

how do you make money on stocks

Let’s make an easy scenario the local pizza store (Pizza Town) needs money to expand, but Pizza Town doesn’t want to take a loan, so instead they have has an IPO (Initial public offering). They issue one hundred shares of stock. The entire business becomes valued at $1,000, so each share of stock is worth $10. If you buy one share of PT (The ticker symbol for Pizza Town).

A few months later, Pizza Town’s expansion is doing great, and Pizza Town is now valued at $2,000. The denominator (the total shares outstanding, 100) hasn’t changed, but the numerator has (the total value of the company has moved from $1,000 to $2,000). Your fraction (1% as represented by your one share) of Pizza Town is now worth $20. You can either hold on to it and wager that Pizza Town will continue to grow the business and increase profits, or you can sell it and take a 100% return.

As for how much money you can make, it’s limitless. Your stock can continue to raise in price/value for ever or it could drop and become worthless. Most everything about stocks is timing.

Daily Financial Advice Mallard 3-1-2014

Daily Financial Advice Mallard 3-01-2014

The moment you think it would be a good idea to withdraw money from the ATM at the bar It’s time to leave the bar.

Happy Saturday! As a reminder watch out when withdrawing money from ATM’s as they will charge you fee’s as high as $3 to withdraw money if it isn’t your own bank. If you are at a bar and have run low on money maybe it is best to slow down for the night or to head on home.

Daily Financial Advice Mallard 2-21-2014

Daily Finance Advice

Daily Financial Advice Mallard 2-21-2014

If you are unsure if you can afford something you can not afford it.

Simply put if you have ever questioned whether or not you can afford something it is best to not buy it. Instead you should wait one week and see if you still want it. If you still can’t afford it then do not buy it. You do not want to take on debt especially credit card debt if you do not need it.